U.S. Health Department unveils new HIPAA rules

The U.S. Department of Health and Human Services (HHS) has announced updated rules that will extend security and privacy requirements to so-called business associates, those contractors and subcontractors, such as billing companies, that perform services on behalf of a health care provider.

The amended Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security rules, which formalize many of the statutory changes already made in the 2009 Health Information Technology for Economic and Clinical Health Act (HITECH Act), also increase penalties for non-compliance to $1.5 million per violation. In addition, the rules clarify the requirements of when data breaches must be reported to HHS.

Business associates are responsible for a majority of the nation's health care data-loss incidents, according to HHS.

“These changes not only greatly enhance a patient's privacy rights and protections, but also strengthen the ability of my office to vigorously enforce the HIPAA privacy and security protections, regardless of whether the information is being held by a health plan, a health care provider, or one of their business associates," HHS Office for Civil Rights Director Leon Rodriguez said in a news release.

The new rules are set to take affect March 26, although business associates will have until Sept. 23 to comply.